UBS On-Air: Market Moves UBS On-Air: Paul Donovan Daily Audio 'British style'
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Oct 30, 2025 The Federal Reserve made headlines with a rare three-way vote, echoing the UK's voting style. Fed Chair Powell cautioned that a rate cut in December isn't guaranteed, highlighting concerns over economic data. There's also a focus on the European Central Bank's decisions, particularly in relation to weak inflation in Germany. Meanwhile, a new US-China trade agreement promises tariff cuts but raises questions about its long-term viability amidst growing nationalism. Expect a deep dive into how these factors shape global markets.
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Fed's Unusual Three-Way Vote
- The Fed's three-way vote mirrored Bank of England-style dissent, showing unusual internal division.
- Powell signalled December cuts aren't certain due to data gaps and inflation concerns.
QT Pause Signals Neutral Liquidity Stance
- Ending quantitative tightening in December reflects the Fed's view that liquidity supply and demand are roughly balanced.
- The move is neutral rather than overtly accommodative and aims to maintain liquidity equilibrium.
Calm ECB Outlook And German CPI
- The ECB decision is expected to be uneventful with markets pricing no change.
- Preliminary German CPI is forecast to slow slightly, offering limited policy impact now.
